Will Retailers Come Out of Sandy Unscathed?

When it comes to staying safe in a hurricane, it often comes down to how prepared you are. The lesson is as important for retailers as it is for consumers.

As soon as the weather reports starting detailing the threat Hurricane Sandy posed for the East Coast, residents in the area typically had one reaction: head out to the stores and stock-up. Despite all the shopping over the weekend, store closures will likely hurt retailers in the end. But smart management can soften the blow. (Read More:Sandy and the Retail Blame Game)

This weekend, shopping lists varied, but often there were many of the same items and the thought was to go to a handful of stores where these lists could be tackled quickly. Home Depot r Lowes, Wal-Mart or Target, BJ's Wholesale r Costco, and the grocers were usually at the top of one's mind. But any good retailer can make the most of the situation.

Take independent toy retailer Learning Express, which sent a reminder on Saturday morning, that children shuttered in a house for several days — possibly without power — would need something to do. Their answer: new games and crafts, enough to spare a parent's sanity.

That store wasn't the only one with that idea. Savvy retailers filled up email boxes with free shipping, one-day-only-sale offers, realizing that mom might be bored and looking for something to do too as long as the power holds out. None of these events were labeled "storm sales," because none these companies would want to appear to be capitalizing off of the event, but the discounts were there for those who were looking.

Although these emails may inspire some sales, it will be tough to compensate for the lack the foot traffic that will no doubt occur as consumers heed the warnings and stay at home.

Also, all those purchases people made to hunker down for the storm — the chips and bottled water, the wine and the ingredients for chocolate chip cookies, the generator and the batteries, all of which seem equally essential for hurricane preparedness in some folks minds' —may take a bite out of discretionary spending in the months' to come. And this situation will only made worse if gasoline prices soar post-hurricane. (Read More:Sandy to Rock the Oil Market: Traders)

Pulling Demand Forward?

NBG Productions' chief equities analyst Brian Sozzi said watching sales reported by the International Council of Shopping Centers in early November will help gauge what is happening.

He said that some retailers used their websites to highlight their storm supplies. Home Depot , which has about 33 percent of its stores in the path of Sandy, has a "storm central" link on their homepage. Lowe's made no such reference.

Sozzi also was impressed by the storm guide on Sears' homepage, which he expects reflects the investment the company has been making in its digital business. However, he was "disappointed" in dollar store websites, which he thinks "should be taking advantage of being closer to home than big box (stores)."

So, as shoppers scurried around over the weekend making their preparations, analysts were refining their predications for chain store-sales reports, expected to be released on Thursday. But since most of those companies that still report monthly sales are apparel retailers, Sandy, the so-called Frankenstorm, appears to have spooked same-store sales lower.

Retail Metrics President Ken Perkins said the Retail Metrics October Same-Store Index pulled back 10 basis points to a 2.5 percent growth forecast, including the drugstore retailers, and 4.6 percent excluding drugstores.

"October will no doubt mark the 38th straight monthly sales gains," Perkins said. Still, it is important to remember that October is not a huge month for retailers, as it comes on the heels of back-to-school shopping and ahead of the peak holiday shopping season.

Consumers are spending more on Halloween every year, but it still ranks far below Christmas holiday spending. And this year, the timing of the storm may limit a last-minute boost of Halloween shopping.

Election, Warm Weather Pinch Sales

For BMO Capital Markets analyst John Morris, Sandy was just another factor weighing on retail sales in October. In a research note, Morris said he expects retail sales started off strong for retailers in October, but sales slowed as the month progressed, hurt by both warming weather in late-October and an increased focus on the U.S. presidential election.

Looking ahead, given the anticipated length and location of "Frankenstorm," we think the potential hurricane impact on mall traffic is more likely to hurt weaker players that still need to clear inventory. That includes teen retailers such as Abercrombie and Fitch and Aeropostale . Morris expects both to post same-store sales declines, and he cut his estimate for Aeropostale's third-quarter earnings.